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The Flight Into Equities
Headliners shepherds and their sheep that insist the market rise since
Fall 2008 and Spring 2009 lows is a fluke may not know economics,
history, money or politics well enough to prosper.
Let us start with History: Those who do not learn from history repeat
it. People since the time of Joseph in Egypt knew we have seven abundant
years and seven lean years, so they should save for a rainy day. We call
this the Sabbatical. Some who read the Old Testament knew from the time
of Moses and Solomon we have 50 year generational seasons of Spring,
Summer, Fall and Winter to plant, grow, harvest and lie dormant. We call
this the Jubilee.
Next, Economics: The market looks ahead, not back. Two fundamental rules
of economics are: A) when price goes down, demand goes up, and B) when
supply goes up, price goes down. If we apply this to markets, we see
clearly what is going on. Banks just increased the supply of their
stock, so they may take a rest while prices go down. Government and big
corporations increased the supply of bonds and mortgages, so their
prices are going down and yields going up, no matter how much government
tries to do the opposite. When prices are low enough, the market buys,
as it did last Fall and this Spring.
Next, Money: Although politicians and their PR servants continually try
to mislead US into trusting money they create by fiat, our founding
fathers knew better that only copper, gold, silver hold their value as
money. That’s why they wrote into the Constitution Article I Section X
that only gold and silver were legal tender, and created a Mint with
these standards.
That’s also why they did not authorize a private central bank, which
Jefferson said was more dangerous than standing armies because banks
deflated and inflated money. The 1913 dollar when the Federal Reserve
and Income Taxes began, is now worth 2 cents in gold, more in silver and
less than a penny in copper or paper. Jackson, Lincoln and Kennedy tried
to return to sound Constitutional moral money principles and received
attempts on their lives.
Our Masonic Junto ancestors including Franklin knew their Bible. The Old
Testament says: /The borrower is servant to the lender/. The New
Testament says: /Owe no man anything but love./ Some of them even knew
Shakespeare wrote in Hamlet: /Neither a borrower nor lender be./
Finally. Politics: We know in our heart of hearts we do not get
something for nothing, no matter what neoKeynesians in government
promise. But we keep electing politicians who promise the most and
deliver less.
